OREANDA-NEWS. August 4, 2010. Avangard (LSE: AVGR LN) raised its shell egg production 29% y-o-y to 1,910 mln pieces in 1H10, the company announced in a pre-close trading update. The company’s flock as of June 30 amounted to 18.6 mln heads, up 4.3% y-o-y. Avangard said its average sale price increased 44% y-o-y to USD 0.046 per piece (ex-VAT). The company’s Imperovo Foods dry egg product plant (acquired in July 2009) processed 287 mln eggs in 1H10; the average sale price for this segment was USD 6.78 per kg (ex-VAT). Financial results for 1H10 are scheduled to be published on August 25.

Concorde Capital: based on our conversation with company management, the 29% increase in shell egg output to 1.9 bln pieces vs. 4.3% growth in its egg-laying flock in 1H10 can be explained by the fact that Avangard’s hens reached maximum biological productivity during the period under review. Based on our calculations, 1H10 output translates into aggregated revenues of USD 157.9 mln (+139% y-o-y), which suggests strong FY10 financial results for Avangard. Given the company’s earlier targets of 4.6 bln shell eggs output (+28% y-o-y), we expect Avangard to increase its 2H10 shell egg production volume by 41% compared to 1H10 to 2,690 mln pieces (+27% y-o-y). We anticipate the company’s sales to grow by 29.3% y-o-y to USD 413.7 mln in FY10, outperforming our previous, more conservative forecast of USD 351.8 mln by 18%.